Markets Underestimating Long-Term Effects of Bitcoin Halving, According to Crypto Giant Bitwise

The digital asset market tends to underestimate the long-term price impact of Bitcoin (BTC) halvings, according to the crypto index fund management giant Bitwise.

Bitwise notes that after the previous halvings in 2012, 2016 and 2020, the price of BTC in the first month went up 9%, dropped 10% and went up 6%, respectively.

However, Bitcoin skyrocketed by 8,839% in the first year after the 2012 halving, 285% in the year after the 2016 event and 548% after the 2020 halving.

Bitcoin spot trading volumes have also grown in the year following each of the three halvings, according to Bitwise Chief Investment Officer Matt Hougan and Juan Leon, a senior crypto research analyst at the company.

“Of course, we have limited data: We are only working with three historical examples. Still, the picture they paint is relatively intuitive, suggesting that the market prices in the short-term impact of the halving but underestimate the long-term impact. The data also suggests that long-term, the halving may be conducive to price appreciation.”

Bitcoin’s halving date is currently slated for April 20th, according to the hash rate marketplace NiceHash.

BTC is trading at $61,486 at time of writing. The top-ranked crypto asset by market cap is down more than 3% in the past 24 hours and more than 12% in the past week.

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